Market snapshot

Office Market Pulse Bristol Q1 2014

City centre take-up in Q1 of 2014 is lower than average but numerous deals in the pipeline indicates a return in occupier confidence, with demand being driven by businesses seeking additional space for expansion, in addition to the normal lease-event driven churn.

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City centre take-up in Q1 2014 was lower than average, in contrast, out of town figures are up on ten year average

Take-up in the city centre in Q1 was at 115,722 sq ft which is 19% below the average Q1 take-up for the last five years.

There has been a lack of large deals, with the quarter’s biggest transaction being the 16,500 sq ft letting to HSBC at Redcliff Quay. However, there are numerous deals in the pipeline for Q2 which bodes well for the year to come.

With the improving economic climate increasingly leading to occupier confidence, demand is being driven by businesses seeking additional space for expansion, in addition to the normal lease-event driven churn.

Out of town take-up was particularly strong at 69,061 sq ft; well ahead of Q1 last year, which totalled 27,043. However, with half the take-up accounted for in just two deals, this may not translate into full year figures.

For a detailed breakdown of Q1 2014 take-up by grade, please click here or on Chart 2 to the left of this article.

Purchase of office stock for conversion continues to decrease supply

Supply continues to fall in the city centre, with more under-performing buildings being taken out of the market for residential use. This is especially apparent for grade B/C buildings, where availability has fallen to 692,380 sq ft.

Two new office buildings are under construction and will bring grade A space to the market in late 2014/early 2015.

Grade A supply continues to fall as tenants upgrade accommodation. Total stock in the city centre is currently at just over 300,000 sq ft.

For a detailed breakdown of Q1 2014 availability by grade, please click here or on Chart 1 to the left of this article.